Management's Discussion and Analysis of Financial Position and Results of Operations

For a description of our Company's business, refer to Item 1 of Part I of this annual report on Form 10-K. As indicated in Item 1, we are a mineral exploration and production company engaged in the exploration, acquisition, and development of mineral properties. The following provides information that management believes is relevant to an assessment and understanding of our results of operations and financial condition. The discussion should be read in conjunction with the financial statements and accompanying notes.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

Our Company prepares our financial statements in conformity with accounting principles generally accepted in the United States of America. We disclose our significant accounting policies in the notes to our audited financial statements.

We have elected to use the extended transition period for complying with new or revised accounting standards under Section 102(b)(1) of the JOBS Act. This election allows us to delay the adoption of new or revised accounting standards that have different effective dates for public and private companies until those standards apply to private companies. As a result of this election, our financial statements may not be comparable to companies that comply with public company effective dates.





Going Concern

Our financial statements have been prepared on a going concern basis, which implies that we will continue to realize our assets and discharge our liabilities in the normal course of business. We have generated no revenues to date and have an accumulated deficit of $1,004,986 as of March 31, 2022. The continuation of our Company as a going concern is dependent upon the continued financial support from our shareholders, the ability to raise equity or debt financing, and the attainment of profitable operations from our future business. These factors raise substantial doubt regarding our ability to continue as a going concern. These financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should we be unable to continue as a going concern.









  5

Use of Estimates and Assumptions

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods presented. We are required to make judgments and estimates about the effect of matters that are inherently uncertain. Although, we believe our judgments and estimates are appropriate, actual future results may be different; if different assumptions or conditions were to prevail, the results could be materially different from our reported results.

Fair Value of Financial Instruments

Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants as of the measurement date. Applicable accounting guidance provides an established hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in valuing the asset or liability and are developed based on market data obtained from sources independent of our Company. Unobservable inputs are inputs that reflect our Company's assumptions about the factors that market participants would use in valuing the asset or liability. There are three levels of inputs that may be used to measure fair value:





       Level 1 - Observable inputs that reflect quoted prices (unadjusted) for
       identical assets or liabilities in active markets.
       Level 2 - Include other inputs that are directly or indirectly observable
       in the marketplace.
       Level 3 - Unobservable inputs which are supported by little or no market
       activity.

The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of March 31, 2022 and 2021. The respective carrying value of certain on-balance-sheet financial instruments approximated their fair values. These financial instruments include cash, prepaid expense, accounts payable and accrued expenses, related party advances and notes payable. Fair values for these items were assumed to approximate carrying values because they are short-term in nature or they are payable on demand. Fair values for derivative liabilities were determined under level 2 since inputs used are either directly or indirectly observable in the marketplace.

Derivative Financial Instruments - We account for convertible debt with conversion features representing embedded derivative liabilities in accordance with ASC 815, Derivatives and Hedging. ASC 815-15-25-1 requires that embedded derivative instruments be bifurcated and assessed on their issuance date and measured at their fair value for accounting purposes. In determining the appropriate fair value, we use the Black-Scholes option valuation method, resulting in a reduction of the initial carrying amount of the notes as unamortized debt discount. The unamortized discount is amortized over the term of each note using the effective interest method.

The fair value of derivative instruments is recorded and shown separately under liabilities. Changes in the fair value of derivative liabilities are recorded in the consolidated statement of operations under non-operating income (expense).









  6

We evaluate each of our financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in the consolidated statements of operations. For stock-based derivative financial instruments, we use a weighted average Black-Scholes-Merton option-pricing model to value the derivative instruments at inception and on subsequent valuation dates. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period. Derivative instrument liabilities are classified in the balance sheet as current or non-current based on whether net-cash settlement of the derivative instrument could be required within twelve months of the balance sheet date.





Long-Lived Assets

Long-Lived assets, such as property and equipment, mineral properties, and purchased intangibles with finite lives (subject to amortization), are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable in accordance with Accounting Standards Codification ("ASC") 360 "Property, Plant, and Equipment". Circumstances which could trigger a review include, but are not limited to: significant decreases in the market price of the asset; significant adverse changes in the business climate or legal factors; accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of the asset; current period cash flow or operating losses combined with a history of losses or a forecast of continuing losses associated with the use of the asset; and current expectation that the asset will more likely than not be sold or disposed significantly before the end of its estimated useful life.

Recoverability of assets is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by an asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized as the amount by which the carrying amount exceeds the estimated fair value of the asset. The estimated fair value is determined using a discounted cash flow analysis. Any impairment in value is recognized as an expense in the period when the impairment occurs.





Income Taxes

Potential benefits of income tax losses are not recognized in the accounts until realization is more likely than not. We have adopted ASC 740, Accounting for Income Taxes, as of its inception. Pursuant to ASC 740, we are required to compute tax asset benefits for net operating losses carried forward. The potential benefits of net operating losses have not been recognized in these financial statements because we cannot be assured it is more likely than not we will utilize the net operating losses carried forward in future years.

Recent Accounting Pronouncements

We review new accounting standards as issued. Although some of these accounting standards issued or effective after the end of our previous fiscal year may be applicable to us, we have not identified any standards that we believe merit further discussion. We believe that none of the new standards will have a significant impact on our financial position, future operations or cash flows.









  7






RESULTS OF OPERATIONS

We have limited operational history. From our inception on July 26, 2013 to March 31, 2022, we did not generate any revenues. We anticipate that we may incur substantial losses for the foreseeable future and do not believe we will be able generate revenues during the next 12 months.

Years Ended March 31, 2022 Compared to Year Ended March 31, 2021





Operating Expenses

During the year ended March 31, 2022, we incurred operating expenses of $260,233 compared to $441,653 in the previous year. The main difference in operating expenses is that the 2021 period includes several expenses not incurred in 2022, including the $150,000 expense related to the issuance of preferred stock to our CEO, and the $31,000 expense on the abandonment of the SMG-Gold acquisition.





Other Income and Expense

Other expense totaled $32,812 for the year ended March 31, 2022 versus $18,851 for the comparable period in the prior year. The difference consisted of the following

· Interest expense increased $10,662 on higher levels of debt.




       ·   We reported derivative income in the 2022 period of $142,104 versus
           expense of $58,082 in the 2021 period. See Notes 6 and 7 to the
           accompanying financial statements.


       ·   Debt discount amortization increased $91,194 as explained in Note 6 to
           the accompanying financial statements.


       ·   Gain on extinguishment of debt decreased $112,291. See Notes 7 and 11
           to the accompanying financial statements.




Net Loss

Our net loss for the year ended March 31, 2022 of $293,045 ($0.01 per share) compares to a net loss of $460,504 ($0.01 per share) in the previous year.

LIQUIDITY AND CAPITAL RESOURCES

Since inception we have raised capital through debt financing, advances from related parties and private placements of our common stock. As described in Note 1 to the accompanying financial statements, on December 9, 2021 we executed an MOU with a Singapore based holding company whose subsidiaries are engaged principally in foreign exchange remittance services. Under the MOU, our Company is proposing to acquire 100% of the Singapore based company for a purchase price of $80,000,000, consisting of common and preferred stock totaling $70,000,000 and subordinated debt of $10,000,000. The proposed acquisition is subject to due diligence customary to transactions of this type. There can be no assurance that a definitive agreement between the parties to the transaction can be reached.









  8

Notwithstanding what may happen with our proposed acquisition, our capital commitments for the coming 12 months consist of administrative expenses, expenses associated with investment in companies, and costs of distribution of our securities. We estimate that we will have to incur the following expenses during the next 12 months:





                                          Estimated  Estimated
                                          Completion Expenses
               Description                 Date (1)     ($)

Legal and accounting fees and expenses(2) 12 months 95,000 Investor relations and capital raising 12 months 125,000 General and administrative expenses 12 months 175,000 Transfer Agent and Edgar Services 12 months 18,000 Total

                                                 413,000




  (1) Budget Items are listed in order of priority.
  (2) Includes $45,000 for accounting and auditing.

Since our initial share issuances, our company has been unable to raise significant additional equity funds, forcing us to rely on cash advances and debt financing to meet operating needs. Based on our cash on hand of $426 at March 31, 2022, we will be required to raise additional funds to execute our current plan of operation. As discussed in Note 6 to the accompanying financial statements, although we have a credit line agreement with Mambagone, S.A de C.V. ("Mambagone"), they are no longer honoring additional required advances under the agreement. At present, we have no commitment from anyone to contribute funds to our Company. If we are unable to raise sufficient funds to execute our plan of operation, we intend to scale back our operations commensurately with the funds available to us. In that regard, we will prioritize expenditures to (in order of priority): (i) maintain our mineral exploration license; and (ii) to conduct our planned exploration activities. We intend to raise the capital that we require through the private placement of our securities or through loans. However, we have not received any financing commitments and there is no guarantee that we will be successful in so doing.

We have no plant or significant equipment to sell, nor are we going to buy any plant or significant equipment during the next 12 months. We do not intend to hire any employees at this time.

Limited Operating History; Need for Additional Capital

There is no historical financial information about us upon which to base an evaluation of our performance as an exploration corporation. Our business is subject to risks inherent in the establishment of a new business enterprise, including limited capital resources.

We have no assurance that financing will be available to us on acceptable terms. If financing is not available on satisfactory terms, we may be unable to commence, continue, develop, or expand our exploration activities. Even if available, equity financing could result in additional dilution to existing shareholders.





Balance Sheets

At March 31, 2022, we had cash of $426 and total assets of $3,167 compared with cash of $98,889 and total assets of $99,755 as of March 31, 2021. The overall cash and asset balance decreased from the prior year primarily due to the lack of outside financing.









  9

During the year ended March 31, 2022, we issued 1,596,799 common shares to a company for services provided. 201,451 of those shares were "to be issued" as of March 31, 2021. In addition, we issued a total of 1,353,334 common shares in settlement of related party debt and an additional 250,000 in settlement of other debt.

During the year ended March 31, 2021, we issued 4,000,000 common shares in connection with the SMG-Gold transaction. We also issued 30,968 common shares to two individuals for Board of Director services and 315,790 common shares to a company (with an additional 201,451 shares committed to be issued) for services provided. Extinguishment of related party debt increased our Additional Paid-in Capital by $172,895. Finally, we sold 10,000 shares for $5,000.





Cash Flows



Operating Activities

During the year ended March 31, 2022, we used cash of $98,463 for operating activities compared with $295,665 during the year ended March 31, 2021. The decrease in the cash used for operating activities resulted mainly from a lower net loss in 2022.





Investing Activities

We had no capital expenditures in the 2022 period versus $1,123 in 2021.





Financing Activities

During the year ended March 31, 2022, there were no financing activities. During the year ended March 31, 2021, we received $5,000 from the sale of 10,000 shares of our common stock. In addition, we received proceeds of $390,600 from debt financing, $50,600 or which came from related parties.





Trends

We have not generated any revenue and, notwithstanding the possible acquisition discussed in Note 1 to the accompanying financial statements, have no prospects of generating any revenue in the foreseeable future. We are unaware of any known trends, events or uncertainties that have had, or are reasonably likely to have, a material impact on our business or income, either in the long term or short term, other than as described in this section or in "Risk Factors".

Off-Balance Sheet Arrangements

We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in our financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to our stockholders.





Inflation

The effect of inflation on our revenues and operating results has not been significant.

© Edgar Online, source Glimpses